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Unemployment in the U.S. Is Falling, So Why Isn’t Pay Rising?

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Re: Unemployment in the U.S. Is Falling, So Why Isn’t Pay Rising?

#81

Post by openasocket »

jazzyk wrote: post #56
hyperpape wrote: post #35

Earlier quoted context omitted.

We had a ruling class in the 90s as well, but wages increased. So the question is what is different about today?

Globalization is a wet dream for the ruling class: - global demand markets to sell to - global labor markets to pick from I guess saying that makes me a xenophobe or some such, but I guess I will have to live with it :-)

I am of the opinion that globalization is unfairly maligned.

Globalization increases competition and consumer choice, which drives down prices and spurs innovation to compete. Tariffs do nothing but put up barriers to entry into certain marketplaces and favoring certain companies. Globalization seeks simply to level the playing field. Companies may benefit from increased access to new markets and cheaper sources of goods and labor, but the consumer benefits as well with better products at cheaper prices. Developing nations have benefited by being able to open their doors to foreign investment. Companies pay these workers a pittance relative to workers in the developed nation, but more than those workers would be able to make otherwise. Companies also invest money into infrastructure and education in these nations. The standard of living in developing nations that have entered the global marketplace has improved dramatically. And increased international trade binds nations together, reducing international conflict. Globalization can stop wars!

Globalization is not perfect, it has problems. It has hurt certain groups in the developed world, and things must be done to balance the situation. But it is still an impressive force for good that benefits a wide array of groups, and I don't like it when people just write it off.

Re: Unemployment in the U.S. Is Falling, So Why Isn’t Pay Rising?

#82

Post by Shivetya »

jazzyk wrote: post #58
usmeteora wrote: post #53

Earlier quoted context omitted.

This is true, high skilled employers have lots of trouble finding high skilled workers, and one of the main economic incentives driving gender and ethnic equality in high tech work places is the disadvantage of not being able to have the maximum amount of resources to pool skilled workforces from. They can't get enough qualified people.

>They can't get enough qualified people... ...for the price they are offering. There, fixed it for ya :-)

one of the most overlooked reasons are people who cannot or will not move to where their skill set can gain employment. some of the cannot/willnot are married couples and that is understandable.

then throw in some who hold their skill set to highly with no basis in reality. just because one XXXX language programmer can get a set figure does not mean they warrant it let alone near where they live. I have seen people turn down jobs because they did not like the drive. Damn, you need the job, you do what it takes to keep your family whole!

Re: Unemployment in the U.S. Is Falling, So Why Isn’t Pay Rising?

#84

Post by IanDrake »

maxerickson wrote: post #40
IanDrake wrote: post #23

Earlier quoted context omitted.

So if you were given 25 million dollars you would automagically make obscene amounts of money with no effort? History shows otherwise with a very high rate of bankruptcies from lottery winners.

You could make $300,000-$400,000 per year putting that in CDs. In the top 1 or 2% of households by income for pretty much doing nothing. Maybe not a literally obscene income though.

I must not have made my point well.

Sure, you could do that and maybe you would. However, most people who didn't earn their money don't.

Most of those same people think the rich "do nothing" and make money. It's this kind of ignorance that causes bullshit class warfare where it doesn't exist.

Re: Unemployment in the U.S. Is Falling, So Why Isn’t Pay Rising?

#85

Post by Arizhel »

beagle3 wrote: post #73
ptr_void wrote: post #70

Earlier quoted context omitted.

I think jazzyk was hinting that - with enough pay, people will do what they can to make themselves qualified. There's also the option of choosing the best people they get and start training them internally to make them qualified.

The problem is, "make themselves qualified" to be good electrical engineers or even software engineers takes on the order of 10-15 years. If tomorrow every electrical engineer salary went 10 times higher, supply would still take 10 years to improve.

Then the employers better get busy raising salaries now, right?

This situation has been created by the employers. They've held salaries down, they've refused to give raises at all (which is why everyone changes jobs every few years, so they can get back to "market rate" instead of their salary being stuck at whatever they were hired at + minuscule cost-of-living raises), and they've had massive layoffs constantly. It's all added together to paint engineering and tech as a highly unstable career path, with high starting pay but lousy job security and the need to move to a few tech hubs, and nowhere else, so that you can take advantage of the frenzy and do well. Other careers with high educational requirements, like medicine, are not like this. Doctors don't change employers every 18 months like Silicon Valley engineers do.

Re: Unemployment in the U.S. Is Falling, So Why Isn’t Pay Rising?

#86

Post by abakker »

roymurdock wrote: post #78
abakker wrote: post #50

Well, if Labor is a function of supply and demand, then it tells us that supply of willing labor is happy to work at all , even if wages aren't rising. Turned around, in a market where people are desperate for work, corporations have no incentive to raise wages. Still, this is overly simplistic. The problem in my mind is that unemployment rate is reflective only of those looking for work, and labor force participatio…

If you are interested in learning how labor markets are taught in macro today, check out these slides from Acemoglu of MIT: http://economics.mit.edu/files/10284 Labor market models are much more about flows, and frictions to those flows, rather than "static" views of labor supply and demand. When I was studying econ, I found some of these models and equations to be the most well thought-out and powerful tools present…

Thanks - I appreciate the reference. Mankiw's treatment in the intro to econ book that I studied is definitely painful.

Re: Unemployment in the U.S. Is Falling, So Why Isn’t Pay Rising?

#87

Post by Bartweiss »

Retric wrote: post #18
js2 wrote: post #15

Earlier quoted context omitted.

The statistic is not meant to be a trick and the BLS discloses exactly how the number is computed: https://www.bls.gov/cps/cps_htgm.htm It's still a useful number for comparing unemployment over time as long as the rules for how it's computed don't change. Also: Some have argued, however, that these unemployment measures are too restricted, and that they do not adequately capture the breadth of labor market problems.…

Not really because you can have constant unemployment as the situation becomes worse. Or a rise in unemployment while the situation improves. At best it allows you to compare snapshots in identical situations over very short time periods assuming nothing significant is going on.

It's a perfectly good statistic for economists, because they know those limitations. There are lots of other measures for wages, labor participation, etc, and 'unemployment' does capture useful info about the ease of finding a job after you leave a previous one.

It's just abused in the public sphere as a whole-story statistic.

Re: Unemployment in the U.S. Is Falling, So Why Isn’t Pay Rising?

#88

Post by maxerickson »

IanDrake wrote: post #84
maxerickson wrote: post #40

Earlier quoted context omitted.

You could make $300,000-$400,000 per year putting that in CDs. In the top 1 or 2% of households by income for pretty much doing nothing. Maybe not a literally obscene income though.

I must not have made my point well. Sure, you could do that and maybe you would. However, most people who didn't earn their money don't. Most of those same people think the rich "do nothing" and make money. It's this kind of ignorance that causes bullshit class warfare where it doesn't exist.

Are lottery winners the majority among people that don't earn their money?

Re: Unemployment in the U.S. Is Falling, So Why Isn’t Pay Rising?

#90

Post by Shivetya »

ptr_void wrote: post #70
usmeteora wrote: post #61

Earlier quoted context omitted.

hmm, Well, I was specifically referencing the top 5 biggest tech companies, and the pay may seem low to the people who have been working there fresh out of college but its still relatively high pay compared to most other industries with people of the same academic and skill level but in a different industry. They interview alot of people and the people don't turn down the jobs because the pay isn't enough, they don't…

I think jazzyk was hinting that - with enough pay, people will do what they can to make themselves qualified. There's also the option of choosing the best people they get and start training them internally to make them qualified.

Sadly I think you vastly over estimate what the majority of people will do. There is an energized minority of people who will change skill sets as their employment needs warrant or simply because they need a new challenge.

there are many who are just willing to grouse about their situation and not, how do you change them?

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